Forex Market Analysis: Tesla Surpasses Q2 Delivery Estimates

2024/07/04

CURRENCIES

GBP/USD retail trader data:

• Net-long position: 43.40%
• Short-to-long ratio: 1.30 to 1
• Net-long traders:
  • Decreased by 18.07% since yesterday
  • Decreased by 0.62% from last week
• Net-short traders:
  • Increased by 23.53% since yesterday
  • Decreased by 2.02% from last week

Contrarian stance to crowd sentiment:

• Current net-short position suggests potential continued rise in GBP/USD prices.
• Positioning is more net-short than yesterday but less net-short compared to last week.
• Mixed GBP/USD trading outlook based on current sentiment and recent shifts.

EUR/GBP retail trader data:

• Net-long position: 62.78%
• Long-to-short ratio: 1.69 to 1
• Net-long traders:
  • Increased by 3.38% since yesterday
  • Decreased by 21.19% from last week
• Net-short traders:
  • Declined by 5.22% since yesterday
  • Risen by 26.88% from last week

Contrarian stance to crowd sentiment:

• Current net-long position suggests potential continued decline in EUR/GBP prices.
• Positioning is more net-long than yesterday but less net-long compared to last week.
• Mixed EUR/GBP trading outlook based on current sentiment and recent shifts.

STOCK MARKET

Tesla’s latest announcement:

• Production: approximately 411,000 vehicles in Q2.
• Deliveries: nearly 444,000 cars in Q2, surpassing consensus estimates.
• Despite a year-over-year drop in deliveries, analysts remain bullish.

Analyst reactions:

• Citi analysts:
  • See potential for improving sentiment in Tesla shares and the broader EV market.
• Dan Ives (Wedbush Securities):
  • Describes the delivery results as a “major turning point” for Tesla.
  • Believes Tesla is the most undervalued AI play in the market.
  • Raised price target to $300 from $275, with a bull case of $400 for 2025.
  • Highlights the upcoming robotaxi event on Aug. 8 as crucial for Tesla’s autonomous future.
• Adam Jonas (Morgan Stanley):
  • Calls Tesla’s results the “1st Positive Surprise of the Year.”
  • Notes Tesla delivered 33,000 more units than produced in Q2.
  • Highlights Tesla’s energy storage business as a “show stealer,” with its highest quarterly deployment and a record profit margin.
  • Has an overweight rating with a $310 price target.

Market dynamics and challenges:

• Tesla faces competition from Chinese counterparts and fluctuating US EV demand.
• The company cut more than 10% of its global staff earlier this year to reduce costs.
• CEO Elon Musk acknowledged near-term demand and sales challenges during the shareholder meeting.
• Tesla reduced prices last year to boost sales.

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